Credit Suisse borrows 50 billion from the SNB
The major bank, which has come under pressure, is exercising its option to borrow CHF 50 billion from the Swiss National Bank to secure its liquidity.
Credit Suisse is taking "decisive action to preventively strengthen its liquidity". It is exercising its option to borrow up to CHF 50 billion from the Swiss National Bank (SNB), the big bank wrote in an ad hoc release on Thursday morning.
The borrowing would be fully secured by first-class assets. In addition, the bank is submitting offers for senior debt instruments against cash payment of up to CHF 3 billion.
"With these measures, we are strengthening Credit Suisse as part of our strategic transformation to create value for our clients and other stakeholders. We thank the SNB and Finma for implementing our strategic change," said CEO Ulrich Körner.
Over the course of March 15, the big bank's share price had temporarily slumped by more than 30% to a record low of CHF 1.56; by the end of trading, the decline was a good 24%. The financial supervisory authority Finma and the SNB subsequently emphasized in a joint statement that the Credit Suisse the for systemically important banks special capital and liquidity requirements, and that the SNB would give the bank will provide liquidity if required.
The background to the share price slide was that CS's major Saudi shareholder, Saudi National Bank, had announced that it would not provide Credit Suisse with any more money. Investors had subsequently sold shares on a large scale. CS had reported a loss of CHF 7.3 billion for 2022. (ah)
